Einstein Bros 2002 Annual Report Download - page 33

http://www.sec.gov/Archives/edgar/data/949373/000104746903027186/a2116520z10-ka.htm[9/11/2014 10:14:22 AM]
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that Mr. Wedo will receive a guaranteed bonus of $187,500 payable in the amount of $46,875 on each of October 31, 2001, January 31, 2002,
April 30, 2002 and July 31, 2002, which is considered a prepayment of the annual performance bonus described above. In addition, Mr. Wedo is
entitled to a one-time bonus of $250,000 upon the consummation of an equity offering by the Company generating at least $25 million or $500,000
if the equity offering generates at least $50 million.
In connection with entering into the amended and restated employment agreement, Mr. Wedo was granted options to purchase 6% of our
outstanding Common Stock (including the Common Stock issuable upon exercise of outstanding options and warrants with an exercise price of
$3.00 per share or less) as of December 6, 2002 for $0.26 per share. The options were granted subject to the approval of the stockholders of any
necessary increase in the number of shares reserved for issuance pursuant to the 1994 Stock Plan. The options vest in one-third increments on each
of December 31, 2002, December 31, 2003 and December 31, 2004.
In the event that we terminate Mr. Wedo's employment other than for cause, he will be paid severance compensation equal to one times his
annual base salary.
Mr. Wedo has agreed that from the date of the employment agreement until the first anniversary of the termination of the employment
agreement, he will not directly or indirectly, without our prior written consent, engage anywhere in the United States (whether as an employee,
consultant, proprietor, partner, director or otherwise), or have any ownership interest in (except for ownership of 10% or less of any outstanding
entity whose securities are listed on a national securities exchange), or participate in the financing, operation, management or control of any firm,
corporation or business (other than us) that engages in the marketing or sale of specialty coffee, bagels and/or fast casual sandwiches as one of its
principal businesses. In addition, Mr. Wedo has agreed that from the date of the employment agreement until the second anniversary of the
termination of the employment agreement, he will not directly or indirectly, without our prior written consent, solicit the services, or cause to be
employed, any person who was an employee of the Company at the date of such termination, or within six months prior to such time.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our officers and directors, and persons who own more than ten percent of our
Common Stock, to file reports of ownership and changes in ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission.
Officers, directors and greater than ten percent shareholders are required by Securities and Exchange Commission regulations to furnish us with
copies of all Section 16(a) forms they file. To our knowledge, based solely on our review of the copies of such forms received by us, we believe
that all Section 16(a) filing requirements applicable to our officers, directors and greater than ten percent beneficial owners have been complied
with for the fiscal year ended December 31, 2002, except for each of our executive officers and non-employee directors who failed to file a report
on Form 5 to report exempt grants of stock and options.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial ownership of our Common Stock as of April 30, 2003 (i) by each
person (or group of affiliated persons) who is known by us to own beneficially more than 5% of our Common Stock, (ii) by each of our executive
officers, (iii) by each of our directors, and (iv) by all directors and executive officers as a group.
Beneficial Owner**
Amount and Nature
of Beneficial Ownership Percentage
Halpern Denny III, L.P.
500 Boylston Street, Suite 1880
Boston, MA 02116 27,816,433(1) 50.1%
Greenlight Capital, L.L.C.
420 Lexington Avenue, Suite 1740
New York, NY 10107 16,289,023(2) 48.2%
Farallon Capital Partners, L.P.
One Maritime Plaza, Suite 11325
San Francisco, CA 94111 7,240,086(3) 12.5%
BET Associates, L.P.
3103 Philmont Avenue